Mergers and Acquistions News
Categories: IT Services & Consulting
May 7th 2009, 15:53PM
Indian IT outsourcer Satyam gave up a 31 per cent share of its equity to global systems integrator Tech Mahindra on Tuesday, in a move which brought both firms closer to finalising their merger at an estimated value of £280 million.
Satyam said Tech Mahindra, via its subsidiary Venturbay Consultants, has acquired 302.76 million shares in the company after it outbid rivals in the race to gain a majority stake in the controversy-hit firm last month.
It is thought B. Ramalinga Raju, Satyam's founder, may have made as much as 30 billion rupees (£402 million) from transactions in shares as the price increased following fake profit announcements.
Venturbay deposited funds in the escrow account as the subscription amount for the initial shares, which Satyam says it expects to use for repayment of certain existing loans.
Tech Mahindra will be making a cash tender offer to the public shareholders with the aim of acquiring an addition 20 per cent, which is scheduled to begin on June 12th.
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